11 days of cash. The CEO wanted to talk about pipeline. I let him for about four minutes. Then I asked:
If I wired you $5 million tomorrow, what would you do differently?
He talked for ninety seconds. Stopped. Then he said: “Nothing. I’d do the same things, slower.”
That was the diagnosis, and he made it himself.
The company didn’t have a cash problem. It had a decision problem that cash had been covering for six quarters. A deeply unprofitable segment nobody would kill. A comp plan that paid for volume in a business that lived on margin. A second-in-command everyone had privately written off.
None of that was hidden. The CEO could have listed all three from memory. He did, when I asked.
Here’s what I’ve come to believe after enough of these: a liquidity crisis is almost never the event. It’s the invoice for decisions deferred somewhere between two and eight quarters back. By the time the cash runs out, the choices that caused it are old news to everyone in the building.
I could have told him all of this in minute one. Earlier in my career I tried that version. It doesn’t take. Being told your judgment was late produces defensiveness. Arriving at it yourself, out loud, in front of someone who won’t flinch, produces a decision.
What’s the decision you’ve already made privately but haven’t said out loud yet?